(Reuters) - American Greetings Corp (AM.N) received a go-private offer from a group led by its chief executive and other members of the founding family, valuing the company at about $580 million.
American Greetings, whose revenue has shrunk 17 percent in the last 10 years, has been forced to spend more on advertising as it struggles to stay relevant in the Facebook age.
The company, whose brands include American Greetings, Carlton Cards and Gibson, has also been hurt by the bankruptcy of its British distributor, Clinton Cards, in June.
CEO Zev Weiss, along with other members of the founding Weiss family and related parties, made the offer on September 25, American Greetings said on Wednesday.
The group held about 80 percent of the company’s Class B shares as of July 2. Each Class B share represents 10 votes compared with one vote for each Class A share.
The Weiss family are descendents of Jacob Sapirstein, a Polish immigrant who founded the company in 1906 shortly after moving to America. The Cleveland, Ohio-based company went public in 1958.
CEO Weiss, who told the board he has yet to secure funding for a takeover, has held various positions with the company since joining in 1992. He was named CEO in June 2003.
The offer of $17.18 per share represents a premium of nearly 20 percent to the stock’s Tuesday close of $14.34.
The company’s shares, which have lost about a third of their value since last September, were up 16 percent at $16.65 on the New York Stock Exchange.
The company said it will form a special committee of independent directors to consider the proposal.
Reporting by Chris Jonathan Peters and Ranjita Ganesan in Bangalore; Editing by Saumyadeb Chakrabarty and Sriraj Kalluvila